Vt. Considers Power Plants To Ease Transmission Grid

Power plants, not power lines,
may be in Vermont's future as a way to ease bottlenecks on the state's
transmission grid.

The Vermont Electric Power
Company (VELCO), which operates the statewide grid, is exploring alternatives
to building costly new transmission upgrades.

Chris Dutton, VELCO's CEO talked
about the potential options at an energy conference in Montpelier for the staff of the New England governors and eastern Canadian premiers.

When the subject is "transmission
infrastructure and financing mechanisms," there's usually some mind-numbing
jargon involved.

But Dutton didn't lapse into
utility-speak. He threw a map up on the screen and pointed to areas around Burlington and Rutland that were outlined by what he called "red blobs."

"What we've done with this
picture is try to identify in the red blobs the areas in Vermont where if we
were to develop non-transmission alternatives they would have the greatest
impact in avoiding or deferring a transmission investment," he said.

The transmission grid always
has to balance the electricity being used to the power coming in. Location is
key, because, at the most basic level, skinny wires can get overloaded trying
to feed areas of high demand. Dutton's red blobs showed places where power
projects would be less expensive than new transmission lines.

"In both Rutland and the Burlington area there are potential non-transmission generating
alternatives that could be available," he said. "Some of them would cost a lot
less than, in the case of the northern transmission investment, $200 million."

In the Rutland area, Dutton said a proposed biomass plant could help
stabilize the grid. And to meet the needs near Burlington, electricity could be imported from Hydro-Quebec and
fed into the grid, not at the border but through a converter in Chittenden County.

There's also the potential near
Burlington for a "peaking" plant - a generator that only runs at
times of high demand. Another alternative could be substantial investment in energy
efficiency, or demand-side management.

The problem for VELCO and its
Vermont utility owners is that they alone may have to pay the
full cost of these investments. But transmission projects - if they benefit the
New England grid - are shared across the entire region.

In an interview, Dutton said
the rules need to be tweaked so that some of the costs of the non-transmission
alternatives could be shared regionally.

"Change either the
marketing rules or the transmission tariffs so that those objectives are
satisfied and so that in fact we can provide the least-cost solution to the
transmission requirements that we have," he said.

Right now VELCO is working on
an update to its long-range transmission plan. Kerrick Johnson, a VELCO vice
president, said the company wants public input.

"What we're trying to get
from the public is an understanding of where we're going to build projects, how
big those projects might be, what those projects might cost, and what
opportunities we see with our distribution utility owners, to find alternatives
other than transmission - so generation and targeted efficiency," he said.

The transmission plan is now
out for public comment. VELCO and the state's utilities will also study the
non-transmission alternatives - and how to pay for them.